Bank's dissidents press for full takeover Group headed by Blast's Hale asks to be given control of Bank of Baltimore's board.

August 09, 1991|By Ross Hetrick | Ross Hetrick,Evening Sun Staff

A group of dissidents has launched round two in its battle to take over Baltimore Bancorp, parent of the Bank of Baltimore, by urging shareholders to finish the job and put it in control of the bank's board.

In a proxy statement mailed to shareholders earlier this week, the dissidents, headed by Baltimore Blast owner Edwin F. Hale Sr., cite their successes in a May proxy fight: the election of six directors, the elimination of the bank's "poison pill" defense against takeovers and the establishment of a shareholders advisory committee.

"These victories will be in vain unless we act now to elect a new majority," the proxy statement says.

The shareholders of the fifth largest banking operation in the state have until Aug. 29 to vote on whether to expand the company's board from 18 to 28 directors. If the measure is approved, 10 Hale allies will take seats and the dissidents will have a majority of the board.

A federal court ordered the new election on the issue of expanding the board because of disputes over how the votes were counted in the May balloting.

Following the May vote, the board of directors removed Harry L. Robinson as chairman and chief executive officer and replaced him with Robert F. Comstock, a lawyer and former chief executive officer of Metropolitan Holding Co., a savings and loan bought by Baltimore Bancorp in 1987.

The Hale proxy statement hammers away at Comstock, calling him a "part-time CEO" who is paid $250,000. In place of Comstock, the Hale group wants to appoint Hale as chairman and Charles H. "Buck" Whittum as chief executive officer.

Hale owns shipping and trucking companies as well as the Blast professional soccer team. Whittum is a retired executive vice president of Signet Bank of Maryland. Both men were among the six dissidents elected to the board in May.

"We feel strongly that the job as Baltimore Bancorp's CEO is a full-time job which demands a depth of commercial banking and experience with institutions of substantial size," the proxy statement says. "Mr. Whittum has those credentials. In our opinion, Robert Comstock, the part-time acting CEO lawyer, does not."

The statement says that Comstock managed a "relatively small, suburban real estate oriented thrift" in the Washington suburbs. "He is a lawyer by trade, and still practices law while purporting to lead Baltimore Bancorp through perhaps the most difficult period in its history," the proxy statement says.

Comstock denies that he is a part-time CEO, even though he is continuing to participate in his Washington law practice.

"It's kind of a joke when you call somebody part time who comes in at 7:30 in the morning and stays until 6 or 7 in the evening," he says.

Comstock also is critical of Whittum's experience, saying he had been primarily a loan officer in his previous position and had never been a chief operating officer, CEO or a member of a bank board -- all positions that Comstock has held.

The proxy statement attacks the $1.8 million payment Robinson received when he left the bank. The payment, attacked by the dissidents as a "golden parachute," was in settlement of Robinson's employment contract that ran until Jan. 31, 1994, according to the bank.

"We believe 'golden parachutes' are only appropriate to ensure job security for outstanding employees, and should not be used to reward poor performance," the Hale proxy statement says. "In no event will any Shareholder Representatives [Hale group] be provided a golden parachute," the statement says.

Comstock says Baltimore Bancorp has tried to settle differences with the Hale group, but adds that no compromise is possible because of Hale's demand to be chairman and for his group to control the board.

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